Pandemic triggers home-buying appetite of millennials
Filipino millennials have emerged as a key driver of growth in the Philippine residential property market, with the pandemic-induced lockdowns awakening in them the aspiration to invest in their own living space, officials of a leading mass housing developer said.
During its recent stockholders’ meeting, 8990 Holdings reported that most of its recent buyers were young people buying their residences for the first time.
“I think the main driver actually is the COVID-19 [pandemic] itself. It tells you: you better move out [of your parents’ house or apartments shared with roommates] at once now that you have the income, now that there’s a bank or Pag-Ibig (Home Mutual Development Fund) that’s willing to take you out,” Mariano Martinez Jr., chair of 8990 Holdings, said in a recent press briefing.
“Now is the [most] opportune time because you might not have this time again. And if you follow the cycle of growth, then that means it will be more expensive again the next time around when we all get over this. There will be exuberance, we will have a lot of [consumer] confidence, then that tends to bring prices up,” Martinez said.
This jibes with the findings of a separate research made by insurer Manulife, which showed that the younger generations of Filipinos were more conscious on saving, budgeting and investing for the future as they deal with financial and mental challenges caused by the pandemic. That survey, however, did not gauge the propensity of millennials, those aged 25 to 40, to invest in real estate.
Prior to the pandemic, 8990 Holdings did not see as much motivation among young people to buy their own residences. Instead, this generation was known for their propensity to buy new gadgets and spend a lot for travel. Now locked down in their parents’ homes or rented apartments amid a prolonged pandemic that requires social distancing, the motivation to own residences has increased.
Article continues after this advertisementTracy Ilagan, 8990 Holdings’ investor relations officer, noted that today’s Filipino millennials now have higher income, such as those employed in call centers and other business process outsourcing (BPO) firms, pharmaceutical, banking and manufacturing. A lot of them have also started their businesses.
Article continues after this advertisementCiting the profile of buyers at 8990 Holdings’ residential condominium development, Urban Deca Homes Ortigas Residences, Ilagan noted that many buyers have just graduated from college for a few years.
“Many found that property to be a good place to invest because it’s so near the [central business districts], not only Ortigas but even [Bonifacio Global City] or Makati,” Ilagan said.
More than 50 percent of the homebuyers at this Ortigas property were single women who wanted to be independent, Ilagan said. She also noted they typically preferred two-bedroom units.
“I don’t tend to differentiate. I don’t call them millennials. I just call them people who really need to buy a house,” Martinez said.
He added anybody who is gainfully employed would have the ability to pay and therefore is qualified to buy a house.
Because 8990 Holdings offers housing units with affordable downpayment and amortization, it has been attracting a lot of first time homebuyers.
“The buyer isn’t burdened … paying for rent and at the same time paying for downpayment. With a very minimal downpayment, we already allow [buyers] to move into [ready for occupancy] units. What they are paying for rent becomes the amortization, the investment,” he said.
